A CRITICAL APPAISAL OF CURRENT ASSEST MANAGEMENT IN BUBLIC LIMITED LIABILITY COMPANIES

(A CASE STUDY OF NIGERIAN BREWERIES PLC ENUGU)

ABSTRACT

This project examined the management of current assets in public

Limited Liability Company. It is obvious that no company can perform

Well without good current asset management. This cares for proper accountability and utilization of these assets for day-to-day transaction of a business concern.

A well co-ordinated current asset management will go a long way to boost productivity, availability of funds, profit and encourage expansion. Investigation ha shown that failure of many business concerns or why some companies perform below expectations lies mostly in the inability of the management to manage their current asset very well.

   Current asset is an asset on the balance sheet usually lasting less than one year or any asset that can be converted into cash within 12 months. Current asset as an essential tool of any business organization needs efficient and effective management.

    Current asset includes – cash, Government boned, inventors, marketable securities, account receivables, prepaid etc and also other assets that are capable of being converted into cash within relatively short period without intervening with the normal operation of the business.

   The relevant data for this study were obtained through the review of related literature and use of questionnaire oral interviews as well as direct observation. This helps us to understand how the various companent of current asset should be managed.

   In the aspect of cash management, cash should be reduced to a minimum, which implies that the firms should keep sufficient cash neither more nor less, and this could only be achieved through cash planning, managing cash inflows and out flow of the firm, investing the cash, white the excess should be invested in marketable securities.

   In inventory control, form is faced with problem of meeting two conflicting needs to maintain a minimum investment in inventories, to maximize profitability and to minimize a large size of inventory, few efficient and smooth production and sales operation. And care must be taken to ensure that stock is ordered through purchase requisition note by the officer responsible for it.

    The presentation of the analysis look the form of chi-square to test the three hypotheses formulated. From the interpretation of data, the following findings were made;

(1)             Proper current asset management has increased the growth of a company.

(2)             Effective and efficient current asset management enhances the profit of public limited liability companies.

(3)             Proper management of current asset leads to high investment and high production.

Equally, Improper management of current asset reduced the growth of company.  And losses of cash are caused not only by mismanagement off current asset but also by decrease in the value of cash as a result of socio-economic situation in the country.

    The researcher therefore tends to carry out research to investigation and know actually how their current assets are manage in public limited ways for further improvement which includes;

(1)                         Installation of budgeting and budgetary control for efficiency

(2)                         Control of overheads so as to minimize payments of cash (cash out flows).

(3)                         Matching of receipts and payment to avoid financial insolvency.

The conclusion of the study is that since proper current asset management has increased the growth of public limited liability company e.g. The Nigerian breweries plc other companies should apply current asset management principles to ensure effectiveness, as well both non-profit in making organization.

TABLE OF CONTENTS                                                          i

TITLE PAGE                                                                             ii

APPROVAL PAGE                                                                             iii

DEDICATION                                                                               v

  ACKNOWLEDGMENT                                                            iv

ABSTRACT                                                                                vi

TABLE OF CONTENTS                                                           viii

 CHAPTER ONE

1.0                   INTRODUCTION                                                         1

1.1                        BACKGROUND INFORMATION OF CASE STUDY  4

1.2                        STATEMENT OF THE PROBLEM                             5

1.3                        OBJECTIVES OF THE STUDY                                   7

1.4                        RESEARCH QUESTION                                               8

1.5                        STATEMENT OF HYPOTHESIS                                 10

1.6                        SIGNIFICANCEOF THE STUDY                                 12

1.7                        SCOPE, LIMITATIONS AND DELIMITATIONS

OF THE STUDY                                                                      13

     1.8                   DEFINITIONS OF TERMS                                           14

                                              CAPTER TWO

2.0              RVIEW OF RELATED LITERATURE                      16

2.1              INTRODUCTION                                                           16

2.2              MANAGEMENT OF CASH                                           18

2.3              THE NEED TO HOLD CASH BALANCES                  19

2.4              CASH PLANNING FORECASTING AND BUGETING  24

2.4                                    INVENTORY MANAGEMENT

2.5                                    NEED TO HOLD INVENTORY AND OBJECTIVES OF

INVENTORY MANAGEMENT                                       26

2.6                                    DETERMINIATION OF THE SIZE OF INVENTORY    33

2.7                                    INVENTORY DECISION MODELS

2.8                                    OBJECTIVES OF INVENTORY MANAGEMENT

2.9                                    ECONOMIC ORDER QUANTITY                                          36

2.10                               MANAGEMENT OF RECEVIABLES                            38

2.11                               GOLES OF CREDIT MANAGEMENT                          40

2.12                               CEREDIT ANALYSIS                                                               42

2.13                               MANAGEMENT OF MARKABLE SECURITIES            46

2.14                               CRITERIA FOR SELECTING MARKETABLE SECURITIES.

                                          CHAPTER THREE

3.0                        RESEARCH DESIGN

3.0                        INTRUDUCTION

      3.1          POPULATION OF STUDY

      3.2        SAMPLING TECHNIQUE

       3.3       INSTRUMENT OF DATA COLLECTION

  3.4       METHOD OF DATA COLLECTION

  3.5         METHOD OF DATA ANALYSIS

   3.6      DECISION RULE

CHAPTER FOUR  

PRESENTATION, ANALYSIS AND INTERPRETATION OF DATA.

4.0                        INTRUDECTION

4.1                   PRESENTATION OF AND ANALYSIS OF DATA.